DOCN DigitalOcean (DOCN) Q4 FY25 earnings call
DigitalOcean reported a strong Q4 FY25, driven by accelerating growth from its top digital native and AI-native customers, with record incremental ARR and significant expansion in AI customer revenue. The company is strategically investing in Agentic Inference Cloud capacity, which is expected to drive revenue growth to 25% by Q4 2026 and 30% in 2027, while maintaining profitability and disciplined capital allocation. Management emphasized the shift from a niche developer cloud to a platform for high-growth AI workloads, leveraging open-source models and integrated full-stack cloud services.
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DOCN operating KPIs by quarter
| KPI | This call Dec 2025 Q4 FY25 | Mar 2026 Q1 FY26 | Jun 2026 Q2 FY26 | Change vs prior quarter |
|---|---|---|---|---|
| Annual recurring revenue (ARR) Customers spending over $1M | $133MOur $1 million-dollar customers reached $133 million in ARR, growing at 123% year-over-year.Source: earnings call transcript | $183MQ1 revenue was $258 million up 22% year-over-year, with million dollar plus customers growing 179% year-over-year to $183 million in ARR.Source: earnings call transcript | — | +37.6% |
| Annual recurring revenue (ARR) AI customers | $120MAnd these customers are growing rapidly with Q4 AI customer ARR reaching $120 million, growing 150% year-over-year, now making up 12% of total ARR.Source: earnings call transcript | $170MAI customer ARR grew 221% to $170 million, and we beat every financial target we shared in our last call.Source: earnings call transcript | $234MAI customer ARR reached $234 million, growing over 200% year-over-year.Source: earnings call transcript | +37.6% |
| Remaining performance obligation (RPO) | $134MWe also continue to improve visibility on our near-term revenue growth as we increased RPO in Q4 to $134 million, up 121% sequentially and up close to 500% year-over-year.Source: earnings call transcript | $243M[ RPO ] reached $243 million, up an extraordinary 1,700% year-over-year.Source: earnings call transcript | $894MThis traction is evident in the material commitments we secured during the quarter which collectively increased remaining performance obligations to $894 million, up more than 12x year-over-year with a 3.7-year average life.Source: earnings call transcript | +267.9% |
| Data centers | — | 20We operate a global scale infrastructure with 20 data centers purpose built for AI workloads running a full stack core computing platform with a complete set of computing primitive that Agentic workloads demand.Source: earnings call transcript | 20Every turn adds products to the stack we own, an integrated platform running on our own infrastructure, spanning 20 global data centers, owning the stack lowers our cost to serve and that lower cost structure combined with the emergence of high-quality, low-cost open weight models gives us better unit economics to serve our customers, which in turn enables us to win more customers.Source: earnings call transcript | 0% |
Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.
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